UK leads brighter ad outlook

LONDON: The outlook in the UK is recovering more strongly than elsewhere as two new reports show strong upwards revisions to previous forecasts of advertising and marketing budgets.

The latest Consensus Ad Forecast from Warc – covering 13 countries and based on a weighted average of adspend predictions from Warc itself, agencies, media monitoring companies, analysts and industry bodies – indicated that global advertising expenditure would increase 5.2% in 2014.

While this was a slight downgrade of 0.2 percentage points on the June 2013 forecast, four countries saw their rate of growth revised upwards, most significantly in the case of the UK where it increased 1.7 percentage points.

Separately, the Q4 2013 Bellwether Report from the IPA, based on data drawn from a panel of around 300 UK marketing professionals, revealed a strong upwards revision to marketing budgets, marking the fifth quarter of consecutive growth and the second-highest rate of growth in this survey's history.

There was a net balance of +11% of companies registering an increase in budgets during the quarter and companies were also highly confident about their financial prospects with the net balance of firms that had become more optimistic measuring +47.0%.

In terms of sectors, the Bellwether report found that internet budgets had seen the sharpest improvement with a net balance of +9.2%. Sales promotion (+1.9%), events (+1.8%) and direct marketing (+1.2%) also saw growth while main media remained unchanged.

Globally, the Consensus Ad Forecast also expected internet adspend to grow quickest in 2014, rising 14.1% on the previous year. This was only channel to have been revised upwards. All others remained unchanged or had been downgraded, and all, apart from newspapers and magazines, were predicted to see growth during the year.

In addition to the UK, adspend growth had been revised upwards in France (+0.7pp), Australia (+0.4 pp) and Italy (+0.1pp). Despite this, Italy was the only country where adspend was expected to contract in 2014, by a marginal 0.2%.

BRIC countries were the strongest performers, with double digit growth anticipated for all. China and India headed the list with forecast increases of 11.2% and 11.0% respectively. Russia and Brazil were close behind with respective rises 10.7% and 10.4%.

"Compared with the last two years, 2014 is looking more optimistic for advertisers globally," said Suzy Young, Warc data editor. "There are major sporting events in the form of the Winter Olympics and World Cup, plus growth is starting to return to Western Europe and the BRICS are predicted to record stronger increases after a more muted 2013."